Sharjah Islamic Bank reports a net profit of AED 697.2 million for the first half of 2025, a 25% increase

Al Bawaba

16-07-2025

Sharjah Islamic Bank (SIB) achieved a strong financial performance during the first half of 2025, achieving a net profit after tax of AED 697.2 million, an increase of 25% compared to AED 558.7 million in the first half of 2024.Income from investments in Islamic financing and sukuk grew by AED 113.6 million, or 6.4%, reaching AED 1.9 billion in the first half of 2025, compared to AED 1.8 billion in the first half of 2024. Meanwhile, total distributions to depositors and Sukuk holders amounted to AED 1.1 billion, compared to AED 1.0 billion, reflecting the Bank's stability in net income and its ability to balance financing growth with an equitable profit distribution mechanism that aligns with Sharia principles. It also demonstrates SIB's resilience in maintaining consistent income even in the face of volatile funding costs and competitive pricing pressures in the market.Sharjah Islamic Bank continues to emphasize the diversification of its revenue base, as evidenced by a significant growth in the net fee and commission income which rose sharply by 53.5% to AED 276.0 million in the first half of 2025, up from AED 179.8 million in the first half of 2024. As a result, the Bank recorded total operating income of AED 1.2 billion, an increase of AED 133.5 million, or 13.0%, compared to AED 1.0 billion in the same period last year. This upward trend reflects SIB's ability to maintain stable operating income in a challenging economic environment while effectively capitalizing on opportunities across various economic sectors.Total general and administrative expenses for the first half of 2025 amounted to AED 405.4 million, an increase of 16.9% compared to AED 346.9 million in the same period of 2024. This rise is mainly attributed to the Bank's continued investment in human capital, technology, and operational infrastructure to support business expansion and improve customer service. Despite the increase in expenses, the Bank's net operating income before impairment provisions reached AED 757.2 million, compared to AED 682.1 million in the first half of 2024, reflecting a 11.0% increase, which shows the Bank's ability to absorb cost pressures while maintaining stable profitability, reinforcing its operational efficiency and sound financial management.The Bank recorded a net reversal of impairment provisions of AED 9.3 million during the first half of 2025, compared to an impairment provision of AED 67.3 million in the first half of 2024, reflecting a significant improvement in the quality of the financing portfolio as well as prudent credit risk management and successful recovery efforts. This positive development contributed significantly to the 25% increase in profit after tax, which reached AED 697.2 million, compared to AED 558.7 million in the same period last year. These results confirm the effectiveness of the Bank's risk mitigation strategies and its commitment to preserving asset quality amid a changing global economic environment.On the balance sheet side, total assets increased by AED 5.5 billion, or 6.9%, to reach AED 84.7 billion as of June 30, 2025 compared to AED 79.2 billion at the end of the previous year. This is backed by increase in total customer financing to AED 43.0 billion, compared to AED 38.1 billion at the end of 2024, marking a 12.9% increase.Customer deposits amounted to AED 52.7 billion, compared to AED 51.8 billion at the end of the previous year. As a result, the financing to deposit ratio stood at 81.5%, compared to 73.6% at the end of the previous year.SIB continued to maintain a strong liquidity ratio of 21.1% of total assets, amounting to AED 17.8 billion, compared to 21.6% at the end of the previous year.
The return on assets and return on equity also increased, reaching 1.70% and 14.88%, respectively, compared to 1.44% and 12.76% for the previous year.